“unexplained investment”

Cash Credits & Unexplained ItemsSection 69Section 695,821 judgments

The decision most relied on for unexplained investment is Sumati Dayal v. CIT (214 ITR 801), cited in 1,967 judgments on BharatTax.

Leading authorities on unexplained investment

Sumati Dayal v. CIT

214 ITR 801 · 1995 · Supreme Court

1,967

citing judgments

The Revenue is entitled to look behind the apparent form of a transaction to discover its true nature, applying the test of human probabilities and surrounding circumstances. If transactions defy logic or are unnatural, they can be treated as bogus, even if supported by some documentation, especially in cases of cash credits or unexplained investments.

K.P. Varghese v. ITO

131 ITR 597 · 1981 · Supreme Court

989

citing judgments

An addition to income cannot be made merely on the basis of a difference in valuation of assets or a Valuation Officer's report without establishing actual understatement of consideration or the source of unexplained funds through proper enquiry. The Assessing Officer must conduct proper enquiry and satisfy the conditions for making such additions.

Chuharmal v. CIT

172 ITR 250 · 1988 · Supreme Court

340

citing judgments

The expression 'income' under Section 69A of the Income-tax Act, 1961, has a wide meaning, encompassing anything that comes in or results in gain. Therefore, an assessee's unexplained investments, such as purchasing articles or depositing cash, can legitimately be inferred and deemed as income under this section.

CIT v. Kamdhenu Steel & Alloys Ltd.

361 ITR 220 · 2014 · High Court

328

citing judgments

When making an addition under section 68, the creditworthiness or financial strength of an investor contributing share capital or share application money can be proved by producing their bank statements showing sufficient balance for the investment. The Supreme Court dismissed the SLP against this decision.

CIT v. Dwarkadhish Investment (P) Ltd.

330 ITR 298 · 2011 · High Court

218

citing judgments

An assessee cannot be asked to explain the source of the source for cash credits, particularly share capital or share application money, once they have discharged the initial onus regarding the identity, genuineness of the transaction, and creditworthiness of the immediate investor.

CIT v. Jansampark Advertising & Marketing (P.) Ltd.

56 Taxmann.com 286 · 2015 · High Court

196

citing judgments

The Commissioner of Income-tax (Appeals) has an independent statutory obligation to conduct proper inquiries and verify facts, especially when the Assessing Officer has failed to do so. The CIT(A) must ensure effective inquiry is carried out before deleting additions or accepting additional evidence.

ITO v. Ch. Atchaiah

218 ITR 239 · 1996 · Supreme Court

149

citing judgments

Under the Income-tax Act, 1961, the Assessing Officer must tax any taxable income in the hands of the correct assessee to whom it truly belongs, having no option to assess it in any other person's hands.

CIT v. Stellar Investment Ltd.

192 ITR 287 · 1991 · High Court

146

citing judgments

Once the identity of the shareholders is established, no addition can be made in the hands of the assessee company under Section 68 for share capital or share application money, as it cannot be treated as undisclosed income.

Judgments citing unexplained investment

Income-Tax Officer Ward-3(3)(1), Ahmedabad vs. Furnish Home, Ahmedabad

The appeal of the asessee is allowed, whereas, Revenue’s appeal is dismissed

ITA 1671/AHD/2025[2017-18]Status: DisposedITAT Ahmedabad30 Jan 2026AY 2017-18

Bench: the Ld. CIT(A), wherein detailed submissions supported by the books of accounts, statutory returns, confirmation and other documentary evidences were filed. A remand report of the AO was sought on the same by the Ld. CIT(A) after considering which, Ld. CIT(A) deleted

For Appellant: Revenue byFor Respondent: Shri Arvind Kumbhare, Sr. DR

Section 250Section 68Section 69

documents like invoices and challans without ensuring the source of funds or business purpose, thereby failing to uphold the Assessing Officer's finding of unexplained investment. (d) The Ld. CIT(A) has erred in law and on facts by allowing the business loss of Rs. 2,00,985/- based solely ... Income-tax Act, 1961, on the ground that certain import payments and customs duty expenses recorded in the appellant's books represented unexplained investments. It was alleged that the appellant failed to satisfactorily explain the nature and source of these payments, and accordingly, the AO treated the entire amount

Furnish Home, Ahmedabad vs. The ITO, Ward-3(3)(1) Old Ward-3(3)(2), Ahmedabad

The appeal of the asessee is allowed, whereas, Revenue’s appeal is dismissed

ITA 1439/AHD/2025[2017-18]Status: DisposedITAT Ahmedabad30 Jan 2026AY 2017-18

Bench: SHRI SANJAY GARG (Judicial Member), SMT. ANNAPURNA GUPTA (Accountant Member)

For Appellant: Revenue byFor Respondent: Shri Arvind Kumbhare, Sr. DR

Section 250Section 68Section 69

Vashdev Darianomal Kalwani, Baherampura Ahmedabad vs. ITO, Ward-2, International Tax, Ahmedabad

In the result, the appeal of the assessee stands allowed

ITA 383/AHD/2024[2015-16]Status: DisposedITAT Ahmedabad30 Jan 2026AY 2015-16

Bench: Shri Sanjay Garg & Annapurna Guptaआयकर अपील सं /Ita No.383/Ahd/2024 िनधा"रण वष" /Assessment Year : 2015-16 Vashdev Darianomal Kalwani Ward-2, Income Tax बनाम/ (In Form No.36 Typed - Ahmedabad/ V/S. Vasudev Darianomal Ito Kalwani) Ward-2 H.No.14/1,Mahatmagandhi International Tax, Colony Ahmedabad Baherampura Road Ahmedbad – 380 022 "थायी लेखा सं./Pan: Cjvpk 1646 L (अपीलाथ)/ Appellant) (*+ यथ)/ Respondent) Assessee By : Shri Samir Vora, Ar Revenue By : Shri Sher Singh, Cit-Dr सुनवाई की तारीख/Date Of Hearing : 17/12/2026 घोषणा की तारीख /Date Of Pronouncement: 30/01/2026 आदेश/O R D E R Per Sanjay Garg:

For Appellant: Shri Samir Vora, ARFor Respondent: Shri Sher Singh, CIT-DR

sole issue involved in this appeal is relating to the addition made by the lower authorities of Rs.56,15,441/- on account of unexplained investment in purchase of property. 3. The lower authorities have made/confirmed the impugned addition holding that the assessee could not explain the source of the aforesaid ... India, which was further invested for the purchase of property. The Ld. Counsel, therefore, has explained that it is not a case of unexplained investment in property, rather, the amount in question was invested out of the income earned by the assessee at Dubai, which was transferred from Dubai bank

Arpita Venkatesh Choulwar, Kothrud Pune vs. ITO WD-3, Pune

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 2306/PUN/2025[2016-17]Status: DisposedITAT Pune30 Jan 2026AY 2016-17

Bench: SHRI DR. DIPAK P. RIPOTE (Accountant Member), SHRI VINAY BHAMORE (Judicial Member)

For Appellant: Shri Suhas BoraFor Respondent: Smt. Neha Thakur (Virtual)

Section 139Section 142(1)Section 144Section 147Section 148Section 148ASection 69

income at Rs.60,29,000/- as against no return filed by the assessee. The above assessed income includes addition of Rs.60,29,000/- as unexplained investments in purchase of immovable property u/s 69 of the IT Act. 5. Being aggrieved with the above assessment order, the assessee preferred an appeal

Babasaheb Sahebarav Jagdale, Masanarwadi Lingali Daund vs. Assessing Officer Ward 14(5), Aayakar Sadan Bodhi Tower Salisbury Park Gultekdi

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 2283/PUN/2025[2018-19]Status: DisposedITAT Pune30 Jan 2026AY 2018-19

Bench: CIT(A) as per clause (b) Sec 246A of the IT Act, 1961. The Learned CIT(A) further erred to hold that Appellant should have filed Appeal to ITAT.

For Appellant: Shri Rajkumar DoshiFor Respondent: Smt. Neha Thakur (Virtual)

Section 142(1)Section 144Section 146ASection 147Section 148Section 148ASection 151ASection 69

Court in Hexaware Technology. b. The Learned Assessing Officer erred both in facts as well as in law in considering entire cash withdrawal as unexplained investment u/s 69 and in treating it as undisclosed income. The information of cash withdrawal from bank does not suggest escapement of income liable

Chandini Duvvuri, Hyderabad vs. ITO, (Int Taxn)-1, Hyderabad

In the result, both the appeals filed by the assessee are allowed in terms of our aforesaid observations

ITA 1855/HYD/2025[2017-18]Status: DisposedITAT Hyderabad30 Jan 2026AY 2017-18

Bench: Shri Manjunatha G. & Shri Ravish Soodआ.अपी.सं /Ita No.1842/Hyd/2025 (िनधा"रण वष"/Assessment Year: 2016-17) Chandini Duvvuri, Vs. Ito (Int. Taxation)-1, Hyderabad. Hyderabad. Pan: Aympd9716A (Appellant) (Respondent) आ.अपी.सं /Ita No.1855/Hyd/2025 (िनधा"रण वष"/Assessment Year: 2017-18) Chandini Duvvuri, Vs. Ito (Int. Taxation)-1, Hyderabad. Hyderabad. Pan: Aympd9716A (Appellant) (Respondent) िनधा""रती "ारा/Assessee By: Shri Siva Charan, Ca राज" व "ारा/Revenue By: Shri Sankar Pandi P, Sr. Ar सुनवाई की तारीख/Date Of Hearing: 28/01/2026 घोषणा की तारीख/Date Of 30/01/2026 Pronouncement: आदेश / Order Per. Ravish Sood, J.M: The Captioned Appeals Filed By The Assessee Are Directed Against The Respective Orders Passed By The Learned Commissioner Of Income Tax (Appeals)-10, Hyderabad, Dated 04/09/2025 & 08/09/2025, Which In Turn Arises From The Respective Orders Passed By The Assessing Officer Under Section 147 R.W.S 144 Of The Income Tax Act, 1961 (For Short, “The Chandini Duvvuri Vs. Ito (Int. Taxn) Act”), Dated 15/05/2024 & 27/05/2025 For Ay 2016-17 & Ay 2017- 18, Respectively. As A Common Issue Is Involved In The Captioned Appeals, Therefore, The Same Are Being Taken Up & Disposed Of By Way Of A Consolidated Order. We Shall First Take Up The Appeal Filed By The Assessee For Ay 2016-17 In Ita No.1842/Hyd/2025 & The Order Therein Passed Shall Apply Mutatis Mutandis For The Purpose Of Disposing Of The Other Appeal. The Assessee Has Assailed The Impugned Order On The Following Grounds Of Appeal Before Us:

For Appellant: Shri Siva Charan, CAFor Respondent: Shri Sankar Pandi P, Sr. AR

Section 147Section 148Section 148ASection 151ASection 251(1)(a)Section 69

failed to come forth with any explanation regarding the source of the aforesaid time deposits, therefore, the AO held the same as his unexplained investment under section 69 of the Act. Accordingly, the AO/NaFAC vide his order under section 147 r.w.s 144 of the Act, dated 15/05/2024 determined the income

Chandini Duvvuri, Hyderabad vs. ITO, (Int Taxn)-1, Hyderabad

In the result, both the appeals filed by the assessee are allowed in terms of our aforesaid observations

ITA 1842/HYD/2025[2016-17]Status: DisposedITAT Hyderabad30 Jan 2026AY 2016-17

For Appellant: Shri Siva Charan, CAFor Respondent: Shri Sankar Pandi P, Sr. AR

Section 147Section 148Section 148ASection 151ASection 251(1)(a)Section 69

Ankit Jain, Hyderabad vs. DCIT., Central Circle -1(2), Hyderabad

In the result, both the appeals filed by the assessee in ITA Nos

ITA 1545/HYD/2025[2020-21]Status: DisposedITAT Hyderabad30 Jan 2026AY 2020-21

Bench: Us:

Section 115BSection 143(3)Section 147Section 148Section 148ASection 292CSection 69

shops. However, the AO did not find favour with the explanation of the assessee made an addition of Rs. 7,44,800/- as his unexplained investment under section 69 of the Act. Accordingly, the AO vide his order under section 143(3) r.w.s 147 of the Act, dated 11/12/2024 determined

Ankit Jain, Hyderabad vs. ACIT., Central Circle - 1(2), Hyderabad

In the result, both the appeals filed by the assessee in ITA Nos

ITA 1544/HYD/2025[2019-20]Status: DisposedITAT Hyderabad30 Jan 2026AY 2019-20

Bench: Us:

Section 115BSection 143(3)Section 147Section 148Section 148ASection 292CSection 69

DCIT., Circle-3(1), Hyderabad vs. South Asian Ceramic Tiles Private Limited, Hyderabad

ITA 1228/HYD/2025[2022-23]Status: DisposedITAT Hyderabad30 Jan 2026AY 2022-23

Section 143(2)Section 143(3)Section 68Section 69

with the source of the said investments, therefore, the AO after putting the assessee company to notice brought the same within the meaning of unexplained investment under section 69 of the Act. 6. Also, the AO observed that the assessee company had during the year under consideration made payments ... making the aforementioned additions, viz., (i) addition of unconfirmed loans made under section 68 of the Act: Rs.3,17,26,261/-; (ii) addition of unexplained investment under section 69 of the Act regarding investment in tangible assets: Rs.13,01,49,074/-; and (iii) addition of unexplained cash credits under section

Satya Kour, Hyderabad vs. ITO., Ward-17(1), Hyderabad

In the result, appeal filed by the assessee is allowed

ITA 1032/HYD/2025[2016-17]Status: DisposedITAT Hyderabad30 Jan 2026AY 2016-17

Bench: SHRI G. MANJUNATHA, HON'BLE (Accountant Member), SHRI RAVISH SOOD, HON’BLE (Judicial Member)

Section 147Section 148Section 148ASection 151ASection 4Section 69A

making addition of Rs.58,48,422/- as unexplained money u/s 69A r.w.s. 115BBE of the Act and Rs.25,00,000/- as unexplained investment u/s 69 r.w.s.115BBE of the Act. 7. Aggrieved by the order of the A.O., the assessee preferred an appeal before the CIT(A) and the Ld.CIT

Sanjay Kumar Mahadeo Patil, Mumbai vs. ITO Ward 42(3)(3), Mumbai

In the result, the appeal by the assessee is allowed for statistical purposes

ITA 8496/MUM/2025[2016-17]Status: DisposedITAT Mumbai30 Jan 2026AY 2016-17

Bench: Shri Sandeep Singh Karhailshri Bijayananda Prusethsanjaykumar Mahadeo Patil, Flat No.502, A Wing, Shivparvati Chs Ltd., Rsa 54, Mhada Layout, Mahavir Nagar, Kandivali (W), Mumbai – 400067 ............... Appellant Pan: Adlpp0237C

For Appellant: Ms. Krupa Shah, Adv. (virtually appeared)For Respondent: Shri Pravin Salunkhe, Sr.DR

Section 250Section 253(3)

NFAC, Delhi, he indirectly erred in upholding the additions made by the Ld. AO, NFAC, Delhi, aggregating to Rs. 4,07,224/- as unexplained investment under section 69 of the I.T. Act in relation to purchase of a new property and raising a total tax demand

Jora Ram Mali, Mumbai vs. The Assistant Commissioner of Income Tax Central Circle 4(2)Mumbai, Mumbai

In the result, the appeal filed by the assessee stands allowed

ITA 7647/MUM/2025[2019-2020]Status: DisposedITAT Mumbai30 Jan 2026AY 2019-2020

Bench: Hon’Ble Shri Sandeep Gosain& Shri Bijayananda Pruseth

Section 153CSection 292CSection 65BSection 69

learned Commissioner of Income-tax (Appeals) (CIT(A)) erred in law and on facts in confirming the addition of 27,15,625/- as unexplained investment under section 69 of the Income-tax Act, 1961, made pursuant to proceedings initiated under section 153C based on a search in the Rubberwala Group

Jora Ram Mali, Mumbai vs. The Assistant Commissioner of Income Tax Central Circle 4(2)Mumbai, Mumbai

In the result, the appeal filed by the assessee stands allowed

ITA 7646/MUM/2025[2018-2019]Status: DisposedITAT Mumbai30 Jan 2026AY 2018-2019

Bench: Hon’Ble Shri Sandeep Gosain& Shri Bijayananda Pruseth

Section 153CSection 292CSection 65BSection 69

Nikhil Raghuvir Kshirsagar, Mumbai vs. Int Tax Ward 3(1)(1), Mumbai

In the result, the appeal of the assessee bearing ITA No

ITA 7529/MUM/2025[2015-16]Status: DisposedITAT Mumbai30 Jan 2026AY 2015-16

Bench: Shri Anikesh Banerjee & Shri Makarand Vasant Mahadeokarnikhil Raghuvir Kshirsagar Vs Int Tax Ward 3(1)(1), Mumbai 404, Neelesh Society, Kautilya Bhavan, Bandra Kurla Vidyalaya Marg, Mulund East, Complex, Bandra (East), Mumbai- Mumbai-400081 400051 Pan:Aykpk2549N Appellant Respondent Assessee By : Shri Dharan Gandhi, Adv. & Ms. Vinita Nara, Adv. Respondent By : Shri Leyaqat Ali Aafaqui, Sr Dr Date Of Hearing : 28/01/2026 Date Of Pronouncement : 30/01/2026 O R D E R Per: Anikesh Banerjee (Jm): The Instant Appeal Of The Assessee Filed Against The Order Of The Ld. Commissioner Of Income Tax (Appeal) 57 (For Brevity ‘The Ld. Cit(A), Order Passed Under Section 250 Of The Income Tax Act 1961 (For Brevity ‘The Act’) For Assessment Year 2015-16, Date Of Order 12.11.2025. The Impugned Order Emanated From The Order Of The Assessment Unit, Income-Tax Department (For 2

For Appellant: Shri Dharan Gandhi, Adv., & Ms. Vinita Nara, AdvFor Respondent: Shri Leyaqat Ali Aafaqui, SR DR

Section 147Section 148Section 250Section 69C

None was present before the Ld. AO during the assessment proceeding and the Ld. AO added back amount of Rs.1,14,00,000/- as unexplained investment u/sec. 69C of the Act. Aggrieved assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A) passed an order and uphold

Anthonette Joaquim Anthony, Mumbai vs. ITO Int Tax Ward 1(1)(1), Mumbai

ITA 6531/MUM/2025[2017-18]Status: DisposedITAT Mumbai30 Jan 2026AY 2017-18

Bench: Shri Om Prakash Kantshri Sandeep Singh Karhail

For Appellant: Shri Devendra JainFor Respondent: Shri Krishna Kumar, Sr. DR

Section 115BSection 144BSection 144C(13)Section 144C(5)Section 147Section 148Section 148ASection 151Section 151ASection 69

order in conformity with the impugned directions of Hon'ble Dispute Resolution Panel u/s. 144C(5) dated 30.06.2025), has erred in adding as alleged unexplained investment or unexplained money u/s section 69/69A to the income of the Appellant. 5) In the facts and circumstances of the case ... Dispute Resolution Panel u/s. 144C(5) dated 30.06.2025), has erred in invoking the provisions of section 115BBE on the alleged addition of unexplained investment or unexplained money of 2,10,500/- thereby taxing the said amount @ 60%.” 4. During the hearing, the learned Authorised Representative (“learned AR”), at the outset

Nevin H. Bharwani, Mumbai vs. ITO (Int Tax) Ward-1(2)(1), Mumbai

In the result, the appeal by the assessee is partly allowed

ITA 6318/MUM/2025[2020-21]Status: DisposedITAT Mumbai30 Jan 2026AY 2020-21

Bench: Shri Om Prakash Kantshri Sandeep Singh Karhailnevin H. Bharwani, 5Th Floor, Noor-E-Rehmat, 50 B.J. Road, Bandra West, Mumbai ............... Appellant Pan : Alrpb8270H V/S Income Tax Officer (International Taxation), Ward – 1(2)(1), Room No.530D, 5Th Floor, ……………… Respondent Kautilya Bhavan, C-41 To C-43, G-Block, Bandra Kurla Complex, Bandra East, Mumbai - 400051 Assessee By : Shri Asif Karmali Revenue By : Shri Krishna Kumar, Sr.Dr

For Appellant: Shri Asif KarmaliFor Respondent: Shri Krishna Kumar, Sr.DR

Section 144C(13)Section 144C(5)Section 147Section 148Section 148ASection 151ASection 69Section 69A

issued to the assessee to show cause as to why the investment of Rs.1.75 crore in time deposit should not be considered as unexplained investment under section 69 of the Act. In response, the assessee submitted that the sum of Rs.1.75 crore was received from her mother and the same ... same became the source of creation of the time deposit by the assessee. Accordingly, the AO held that the investment in time deposit is unexplained investment under section 69 of the Act and proposed to tax the same under section 115BBE of the Act. 7. During the proceedings before

Nayan Rajendra Kshatriya, Mumbai vs. Income Tax Officer, Kautilya Bhavan, Mumbai

In the result, the appeal filed by the assessee is dismissed on above terms

ITA 5530/MUM/2025[2020-21]Status: DisposedITAT Mumbai30 Jan 2026AY 2020-21

Bench: Shri Om Prakash Kant, Am & Ms. Kavitha Rajagopal, Jm

For Respondent: Shri Leyaqat Ali Aafaqui, Sr. AR

Section 143(1)Section 143(2)Section 143(3)Section 250Section 270ASection 271ASection 69

substantiate the nature and source of the investment thereby resulting in an addition of Rs.11,63,000/- u/s 69 of the Act as unexplained investment and penalty proceeding u/s 271AAC(1) of the Act was also initiated. It is further observed that the assessee was also non-compliant during

Nayan Rajendra Kshatriya, Mumbai vs. Income Tax Officer, Kautilya Bhavan, Mumbai

In the result, the appeal filed by the assessee is dismissed on above terms

ITA 5529/MUM/2025[2020-21]Status: DisposedITAT Mumbai30 Jan 2026AY 2020-21

Bench: Shri Om Prakash Kant, Am & Ms. Kavitha Rajagopal, Jm

For Respondent: Shri Leyaqat Ali Aafaqui, Sr. AR

Section 143(1)Section 143(2)Section 143(3)Section 250Section 270ASection 271ASection 69

Deputy Commissioner of Income Tax, Circle 4(2), New Delhi, I.P.Estate vs. Continental Construction Limited, Nehru Place, Delhi

The appeal of the revenue is dismissed

ITA 4055/DEL/2024[2017-18]Status: DisposedITAT Delhi30 Jan 2026AY 2017-18

Bench: Shri Anubhav Sharma & Shri Manish Agarwaldcit, Circle-4(2) Vs. Continental Construction Room No. 384, C.R. Limited, 28-29, Building, Ip Estate, Continental House, Nehru New Delhi – 110002 Place, New Delhi – 110019 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Aaacc2309R Appellant .. Respondent

For Appellant: NoneFor Respondent: Sh. Rajesh Kumar Dhanesta, Sr

Section 142(1)Section 144Section 147Section 147rSection 148Section 69

determining total income at Rs.6,39,30,815/-. 3. The Ld. CIT(A) has allowed the ground of the assessee on the issue of unexplained investment u/s 69 of the Income Tax Act, 1961 of Rs.5,55,75,080/-.The relevant para of Ld. CIT(A)'s order ... funds from any sources.Therefore, I am of the considered view that addition of the renewed fixed deposits Rs.5,55,75,080/- as unexplained investment u/s 69 of the Act is not sustainable and is directed to be deleted. The appeal on thus ground is thus allowed